Facebook regulation: good news for the traditional media industry?

With calls increasing for greater Facebook regulation around the world, FIPP here speaks to publishers, policy experts, and other industry professionals about what this could mean for the traditional media industry.

Back in January, the former Deputy Prime Minister of the UK and recently appointed vice president for global affairs and communications at Facebook, Sir Nick Clegg, gave his first interview since taking on the role. Speaking to the BBC’s media editor, Amol Rajan, the exchange came on the back of the tragic news of the death of 14 year old UK teenager, Molly Russell. Her hather attributed harmful images and videos his daughter had seen on Facebook-owned Instagram to being partly responsible for her death.

“Frankly, one of the reasons that I wanted to join [Facebook] was because I don’t think it’s sustainable for tech companies to just say no we don’t like any, all regulation,” said Clegg. “Now clearly governments, particularly democratically elected governments as in Britain and elsewhere have a real role in setting the new rules, setting the tramlines, the boundaries for the internet."

Global political bodies including the UK’s Department for Digital, Culture, Media and Sport (DCMS) have been calling for a redefinition of social media and wider digital tech platforms for some time now. In July 2018, a joint DCMS and Home Office White Paper, conducted by UK MPs with input from other governmental departments around the world asked the question: ‘How should tech companies be defined - as a platform, a publisher, or something in between?’

To say that the regulatory issues surrounding Facebook and the wider social media world have now reached crisis point would not be to understate the seriousness of the situation at hand. In March, Facebook was forced to defend its platform again, when 50 Muslim worshippers were killed in a terrorist attack on two Mosques in Christchurch, New Zealand, with the event being livestreamed on the social media site.

With a growing range of concerns surrounding Facebook from fake news, to illegal political activity, Russian state-sponsored propaganda and now increasingly serious instances of harmful and extremist content, is stronger regulation on the way?

Kerry Kent is the newly appointed Head of Policy for Change.org. She has previously held policy positions across numerous media and tech organisations including as the Director of Legal Affairs for the UK’s Professional Publishers Association (PPA). Here she outlines what the current regulatory landscape looks like and where it could move to in the near future.

“In short, I think Facebook regulation could come in very quickly,” says Kent. “Businesses need to follow the process carefully to make sure they’re not caught by collateral damage in various governments’ rush to be seen to do something.”

“Right now social media platforms are not that heavily regulated. They are required to take down any illegal content, although there has been extensive discussion down the years over notice and take down and it could be argued that large online content aggregators have been too slow to find a way of doing this effectively. Obviously all the data protection and eprivacy rules apply, as do those relating to advertising, but again getting social media companies on board and working out how the rules can be enforced in areas like ‘online influencers’ has been a bit of a struggle.”

Implementation has of course been a key area of difficulty in a still largely nation-state driven world coming to terms with such dominant, and borderless, global entities. Where social media once brought the egalitarian promise of frictionless communication around the world, the question now arises of how to deal with it. But as Kent states, while international solutions may well be the best way to deal with emerging international issues, it is the reality that from a societal point of view we may not quite be there yet.

“There has been an attempt at international cooperation at UN level with governments, NGOs and individual social media companies signing up to a code of conduct but there were some notable absentees - US and China being the biggest examples. So I guess that’s the long-winded way of saying international cooperation would probably work best but is unlikely. Quite apart from anything else, there are vastly different freedom of speech rules in Europe and the US/rest of the world.”

“So it’s likely to be an EU/individual EU member state initiative to start with. Fundamentally, EU member states are required to follow the stipulations of the ecommerce Directive. Germany has blazed the trail with the NetzDG law which requires owners of any site with a social media element to take down illegal content within a very short time span. In other markets the talk is more radical. Ofcom, the UK broadcast and telecoms regulator put out a discussion paper last year calling for regulation of sites with a social media element in a similar way to broadcasters and online AV content providers. In Italy the drive is similar and the regulator has produced a paper that is reflective of the Ofcom paper, with the Italian regulator going even further and calling for the re-casting of the ecommerce Directive to remove the defence of most social media companies that they are a ‘mere conduit’ for user content and adding some sort of moderation requirement. Similar conversations are happening across France and Spain as well as other EU member states.”

“So in short, there will be change. It will be quick. It will not be at international level. It may not even be at EU level, but at national level there will be a push to put at the very least a rapid take-down of illegal content requirement on websites with social media elements. There could be even further action on taste and decency requirements and a push to go further than the Directive where possible.”

Where European collaboration has already proved fruitful is in the area of GDPR (General Data Protection Regulation), blazing a trail for modern data requirements that the rest of the world is arguably still catching up with. Aroon Purie, founder and publisher of India Today, cites the EU’s work in the area of data regulation as a good example of regulatory bodies beginning to find more comprehensive solutions to managing the digital world.

“The need for regulation is recognised globally,” says Purie. “Europe has been proactive in working on GDPR and seems to have taken even more notice in this area post-Brexit and other election-related controversies. Closer home, the priority has obviously been around elections. Taking note of the immense power that these platforms exercise and the scope for misuse, the Election Commission of India recently made it mandatory for the political parties to declare their spend on social media promotions. America has taken note of the need and is trying to push the platforms to become more transparent and responsible.”

“It seems to be a logical progression to have more stringent regulations against social media platforms. We witnessed the same when other types of media evolved and matured including print, digital and broadcast. The question to ask is: are we comfortable with the rise of platforms who tend to see themselves as autonomous and in some cases, extra-constitutional, or beyond the law of the land? To have fair regulations is not anti-globalisation. Nobody is suggesting banning them.”

So what then, from a publisher point of view, does Purie see as being some of the key outcomes of increased Facebook regulation? On the one hand, a more level playing field could presumably help the traditional industry to take on the Google-Facebook digital advertising duopoly. Equally however, in an ecosystem that has come to rely on social media, at least in part, to widen the distribution of its content, could such measures actually end up having a negative impact on the wider media industry?

“Regulation around best practices, transparency and data privacy can never hurt any business. This transparency is also helpful to publishers as nobody wants to be partnering with an ecosystem where they have to hand over controls into the handle of a third party. Businesses need control over their data and their revenues. I would say the need for greater regulation would not have arisen if the platforms would have adopted a code of self-regulation as an industry.”

“On the content side, if any of these platforms decide to exit a market because of unreasonable regulations, it will certainly impact the distribution of networks. We have the example of Google News exiting the Spanish market back in 2014. So, there is a cause and effect relationship that these platforms have developed with the publishing industry.”

Certainly none of this has evaded the attention of Mark Zuckerberg, who at the beginning of this month stated his belief that there is “a more active role for governments and regulators” to play, and that “Lawmakers often tell me we have too much power over speech, and frankly I agree.”

The question then presents itself just how could these changes impact the reputation of the wider media industry? At a time when senior politicians are attacking the integrity of the press all over the world, and the industry has very real issues to deal with surrounding fake news, alternative facts, and the spread of misinformation, could more tightly binding one of the established poster-boys of the modern media age help to re-establish trust in the industry?

“I would agree that social media companies don’t quite fully fit either the definition of platform or publisher,” says Freddy Mayhew, editor of Press Gazette. “Facebook, for example, is not entirely passive in the way a newsagent is, because its algorithms curate content for people who then engage with it, either liking or sharing etc., but neither is it generating its own content like a publisher. It’s in a kind of of-man’s land between the two, but that looks set to change. For one thing, the Government’s proposal on new online safety laws, set out in the Online Harms White Paper recently, will force it to take even greater responsibility and action for the content it presents to users when this is deemed harmful.”

“A number of newspaper publishers seem to want Facebook to be defined as a publisher and so regulated in the same way as they are to level out the playing field. At the moment Facebook is reliant on using other peoples’ content to fill news feeds and is reaping huge rewards from this with none of the risk. There’s no-one imposing penalties on Facebook or ordering them to issue a correction like there is for the UK media, both in print/online and broadcast, and this needs to change.”

“That said, I don’t know if making Facebook a publisher would be a good thing for the UK news industry. Creating a rival that already makes billions in revenue each year and is a dominant player in the advertising market is probably not ideal. If Facebook went into the news publishing business proper it would be a serious contender and perhaps cause even more trouble for the rest of the industry than it does now. The reach provided by Facebook is still of use to news publishers, but it is abundantly clear that relying on it as the sole driver of traffic and revenue is entirely unsustainable.”

From a journalistic pov, Press Gazette has been a vocal campaigner against the harmful effects of the media conglomerates of Facebook and Google. In 2017, the publication launched its Duopoly campaign to “stop Facebook and Google destroying any more of the UK journalism industry”. The symbiotic relationship between Facebook and the traditional media industry that for a whole new generation of audiences it has in many ways come to represent, remains a sensitive one.

“Facebook has been doing more to combat so-called ‘fake news’ and appears to take the issue seriously. But if it really wants to support quality news journalism the answer is quite simple: pay more back to news publishers. The reality is that news publishers cannot compete for the growing pot of online ad money and unless something changes, the outlook isn’t good. Paywalls offer some solution, but the technology is still nascent and creates the problem of news being exclusive to those who can afford to pay.”

“The UK competition watchdog is due to look at the internet advertising market after a review was twice suggested, first by Dame Frances Cairncross and then by Chancellor Philip Hammond. This is a step in the right direction. If they don’t start paying sustainable sums of money to news publishers for quality content, we should be looking seriously at breaking them up. Not only does a sustainable news industry depend on it, but something far more important as well: democracy itself.”

Jim Edwards, editor-in-chief of Business Insider UK, takes a slightly different view, reminding us of the advantages for publications that such a huge distribution network like Facebook can pose.

“I think new regulations will help Facebook, by making it a safer and less controversial environment for brands to be in. It's not a zero-sum game. Just because Facebook succeeds doesn't mean that other publishers lose out. If the new rules militate in favour of brands with established reputations for reliability, trust and non-harmful content, then Facebook is likely to lean toward those brands - and that means established news publishers like Insider Inc. It’s a huge platform for publishers and that won't change anytime soon, in fact the changes will probably be an opportunity for publishers. Any changes that make your Facebook news feed more helpful and reliable — and less like a bar full of drunk, angry conspiracy theorists — is going to help brands publishing reliable, fact-based information.”

Eventually in most conversations about Facebook, all roads lead back to data, and this one is no different. Edwards reinforces the fact that, regulation or no regulation, Facebook is now a huge global player within the media industry and likely has the resources to pivot based on any new legislation that regulatory bodies throw at it.

“New regulation always benefits the established players,” says Edwards. “They are the ones with the money, software engineers, and legal and compliance staff to handle it. GDPR is a good example of that. The big media brands didn't break their stride in compliance with GDPR. It's the small businesses, the Mom and Pop websites, that really suffer when new rules come in. It's much easier for established brands to demonstrate that they are ‘safer’ than new challenger brands. So this works against small businesses and new media publishers to the benefit of larger, more established companies.”

Richard Wheaton, managing director for data company 55, sees increased regulation around data usage within the media and advertising industries as an opportunity, rather than a hindrance.

“User consent is critical to digital marketing today,” says Wheaton. “Brands that cut corners in this area are in danger of paying a high price for non-compliance, whether through fines from the regulator or brand reputation, or both. Consumer tolerance for a lack of consideration of their preferences has been worn out, and however a brand comes in possession of their data, great thought needs to be given to how it can be used. I think that every responsible data expert actually sees this as an opportunity. If obtaining consent from a consumer grants a brand permission to have a more engaged conversation, then this is a good thing. The challenge - and opportunity - for brands is to offer benefits to consumers that make opting-in worthwhile, and earn the information that they obtain in a fair exchange of value.”

Looking at Facebook more specifically, Wheaton is less convinced that impending regulations are as set in stone as some industry practitioners may think.

“I don't think that tighter regulations are inevitable, and the precise nature of any legally binding requirements are fraught with difficulties and potential unintended side-effects. Initiatives like ITP2.1 are good examples of the tech players imposing restrictions on themselves. Apple is leading this, but we are sure that Firefox, Google and Facebook will follow suit. The important step is not the regulation, but the changes in behaviour that the laws are trying to encourage - transparency, user control, minimal load times, etc. Laws in this space should be a last resort, because they rarely succeed in their aims without the willing engagement of the tech industry anyway.”

What is perhaps most striking of all about the Facebook story is that it has taken this long for greater regulatory calls to be made. Now 15 years old and with a global footprint of an estimated 2.3bn+ users, Mark Zuckerberg’s personal brand of naive kid from Harvard has perhaps in part thus-far, been what’s helped to stave off increased scrutiny. But change is afoot, and there is a growing acceptance that Facebook and the other social media players behind it are now an established part of the traditional media industry. Introducing greater regulatory structure around this key player could well help the sector as a whole to tackle key issues around trust and misinformation, and prepare for the next wave of technological change.

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